American Reliable v. Stillwell , 336 F.3d 311 ( 2003 )

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
AMERICAN RELIABLE INSURANCE 
COMPANY; AMERICAN BANKERS
INSURANCE COMPANY OF FLORIDA;
CAMPBELL INSURANCE SERVICES,
INCORPORATED,
Plaintiffs-Appellants,  No. 02-1431
v.
ROBERT STILLWELL; HELEN
STILLWELL,
Defendants-Appellees.

AMERICAN RELIABLE INSURANCE 
COMPANY; AMERICAN BANKERS
INSURANCE COMPANY OF FLORIDA;
CAMPBELL INSURANCE SERVICES,
INCORPORATED,
Plaintiffs-Appellees,  No. 02-1807
v.
ROBERT STILLWELL; HELEN
STILLWELL,
Defendants-Appellants.

Appeals from the United States District Court
for the Northern District of West Virginia, at Wheeling.
Frederick P. Stamp, Jr., District Judge.
(CA-01-59)
Argued: February 24, 2003
Decided: July 16, 2003
2 AMERICAN RELIABLE INSURANCE v. STILLWELL
Before TRAXLER and SHEDD, Circuit Judges, and
C. Arlen BEAM, Senior Circuit Judge of the
United States Court of Appeals for the Eighth Circuit,
sitting by designation.
Affirmed by published opinion. Judge Traxler wrote the opinion, in
which Judge Shedd and Senior Judge Beam joined.
COUNSEL
ARGUED: Stephan Isaiah Voudris, JORDEN BURT, L.L.P., Miami,
Florida, for Appellants. Thomas Clark Schultz, Wheeling, West Vir-
ginia, for Appellees. ON BRIEF: Markham R. Leventhal, JORDEN
BURT, L.L.P., Miami, Florida; John Preston Bailey, BAILEY,
RILEY, BUCH & HARMAN, L.C., Wheeling, West Virginia; Kevin
S. Burger, MARGOLIS EDELSTEIN, Pittsburgh, Pennsylvania, for
Appellants. Don A. Yannerella, Wheeling, West Virginia, for Appel-
lees.
OPINION
TRAXLER, Circuit Judge:
Appellants American Reliable Insurance Company, American
Bankers Insurance Company of Florida, and Campbell Insurance Ser-
vices, Inc. (collectively "Appellants"), appeal the district court’s dis-
missal of their petition to compel arbitration of claims asserted against
them in West Virginia state court by Appellees Robert and Helen
Stillwell. See American Reliable Ins. Co. v. Stillwell, 212 F. Supp. 2d
621, 623-24 (N.D.W.Va. 2002). The district court dismissed Appel-
lants’ complaint on three alternative grounds: (1) the court lacked
jurisdiction pursuant to the Rooker-Feldman doctrine; (2) American
Reliable and Campbell had waived the right to arbitration; and (3)
abstention was appropriate under Colorado River Water Conservation
Dist. v. United States, 424 U.S. 800 (1976). On appeal, Appellants
AMERICAN RELIABLE INSURANCE v. STILLWELL 3
challenge all three bases offered by the district court in support of the
dismissal of their action to compel arbitration.
Appellants also appeal the district court’s refusal to impose Rule
11 sanctions against the Stillwells for seeking attorney’s fees and liti-
gation costs. The Stillwells cross appeal the district court’s denial of
their motion for attorney’s fees and costs. We affirm.
I.
In February 1999, the Stillwells purchased a homeowners policy
issued by American Reliable. The policy contained an arbitration
clause that provided, in part, as follows:
Any and all disputes, controversies or claims of any kind
and nature between you and us arising out of or in any way
related to the validity, interpretation, performance or breach
of any provisions of this policy, and upon which a settle-
ment has not been reached by you and us, shall be resolved
exclusively[,] by arbitration in accordance with the Federal
Arbitration Act (9 U.S.C. § 1 ET SEQ).
J.A. 91. Shortly thereafter, the Stillwells’ mobile home sustained
damage in a wind storm. After an initial dispute about whether the
loss was covered by the American Reliable policy, the parties settled
the Stillwells’ claim for property loss.
In February 2000, the Stillwells filed an action in state court
against American Reliable and Campbell Insurance for various claims
relating to the policy, alleging that American Reliable and Campbell
Insurance handled their claim under the policy in bad faith and vio-
lated certain West Virginia statutory provisions regarding the han-
dling of insurance claims.1 American Reliable and Campbell filed an
answer that included a number of affirmative defenses; however, the
answer did not invoke the arbitration clause. In April 2001, the Still-
wells amended the complaint to add American Bankers as a defendant
1
Campbell Insurance was named as a defendant based on its alleged
status as general agent for American Reliable.
4 AMERICAN RELIABLE INSURANCE v. STILLWELL
and to convert the lawsuit into a class action.2 For the first time, in
answering the amended complaint, Appellants invoked the arbitration
clause.
On May 1, 2001, after the state court proceedings had been in prog-
ress for 14 months, Appellants filed a joint motion in state court to
compel arbitration and stay judicial proceedings, pursuant to the Fed-
eral Arbitration Act ("FAA"). See 9 U.S.C.A. §§ 1-16 (West 1999 &
Supp. 2003). On June 11, 2001, the West Virginia state court denied
Appellants’ motion to compel arbitration and stay judicial proceed-
ings, concluding that the policy was "a contract of adhesion" and that
Appellants "proffered no evidence that the parties to this contract
knowingly bargained for an arbitration clause." J.A. 121-22.
On May 18, 2001, while Appellants’ motion to compel arbitration
was pending in state court, Appellants filed, but did not serve, this
action in federal court seeking to compel arbitration of the Stillwells’
state law claims — the same issue that Appellants had raised and ulti-
mately lost in state court. Appellants completed service of the federal
complaint only after the state court denied their motion to compel
arbitration three weeks later. Moreover, almost immediately after the
state court issued its decision, Appellants filed a motion in district
court to compel arbitration of the Stillwells’ state law claims. Appel-
lants argued that "the state court issued an erroneous ruling which
failed to follow Federal law under the FAA and which denied the
motion to compel arbitration" and urged the district court to rectify
the situation by "enforc[ing] Federal law under the FAA and . . .
enter[ing] an Order compelling the parties’ dispute to arbitration."
American Reliable, 212 F. Supp. 2d at 625. In response, the Stillwells
filed a motion to dismiss the federal action on numerous grounds,
including the Rooker-Feldman doctrine, the Younger abstention doc-
trine, and principles of res judicata and collateral estoppel.
While awaiting a decision from the district court, Appellants
attempted to obtain review of the state trial court’s denial of arbitra-
tion in the West Virginia appellate courts. First, Appellants moved
2
The Stillwells named American Bankers as a defendant because it
was the parent company for American Reliable and allegedly processed
the Stillwells’ claim under the policy.
AMERICAN RELIABLE INSURANCE v. STILLWELL 5
unsuccessfully in the state trial court for an order certifying the arbi-
tration question for interlocutory appeal to the West Virginia Supreme
Court of Appeals. Next, Appellants petitioned the West Virginia
Supreme Court for a Writ of Prohibition against the enforcement of
the trial court’s order denying arbitration, which the supreme court
refused to grant. Then, Appellants filed a petition seeking permission
to appeal the state trial court’s rejection of arbitration to the West Vir-
ginia Supreme Court, which was also denied. Ultimately, Appellants
unsuccessfully sought review of the denial of the petition for appeal
in the United States Supreme Court. See American Reliable Ins. Co.
v. Stillwell, 123 S. Ct. 112 (2002).
The district court concluded that Appellants’ federal lawsuit was
the "‘functional equivalent’ of an appeal from the June 11, 2001 state
court decision" denying arbitration — clearly demonstrated, the dis-
trict court reasoned, by Appellants’ "failure to actively pursue their
complaint and petition to compel arbitration until after the state court
ruling." American Reliable, 212 F. Supp. 2d at 627. Based on that
conclusion, the district court held that it was precluded by the Rooker-
Feldman doctrine from considering an identical motion to compel
arbitration and dismissed the action for lack of subject matter jurisdic-
tion.
Alternatively, the court found that Appellants, having "litigate[d]
the state court case for a period of 14 months before they even men-
tioned that they wished to enforce the arbitration provision in the con-
tract," waived the right to invoke the arbitration clause. Id. at 628.3
Additionally, the district court determined that even if the Rooker-
Feldman and waiver doctrines did not apply, federal court abstention
was appropriate under the Colorado River doctrine of abstention
because the federal "action was not filed until more than 14 months
after the state court case was filed, the defendants are challenging the
validity of the arbitration clause, which implicates state law, the state
court forum is adequate to protect the federal plaintiffs’ rights, and the
3
The district court’s waiver analysis did not apply to American Bank-
ers, which was not added as a defendant until the case had been pending
in state court for more than one year. See American Reliable, 212 F.
Supp. 2d at 629.
6 AMERICAN RELIABLE INSURANCE v. STILLWELL
state court has already ruled on the issue before this Court." Id. at
631.
On appeal, Appellants challenge each of the bases identified by the
district court in support of its order of dismissal. Because we agree
that the district court properly applied the Rooker-Feldman doctrine,
we do not reach Appellants’ additional arguments.
II.
A.
Under the Rooker-Feldman doctrine, a "party losing in state court
is barred from seeking what in substance would be appellate review
of the state judgment in a United States district court." Johnson v.
DeGrandy, 512 U.S. 997, 1005-06 (1994). We regard the doctrine as
jurisdictional. See Friedman’s, Inc. v. Dunlap, 290 F.3d 191, 196 (4th
Cir. 2002) ("Because the Rooker-Feldman doctrine is jurisdictional,
we are obliged to address it before proceeding further in our analy-
sis."); Plyler v. Moore, 129 F.3d 728, 731 (4th Cir. 1997) ("Under the
Rooker-Feldman doctrine, lower federal courts do not have jurisdic-
tion to review state-court decisions."); Jordahl v. Democratic Party
of Va., 122 F.3d 192, 197 n.5 (4th Cir. 1997) (noting that the Rooker-
Feldman doctrine is a jurisdictional matter that a court is empowered
to raise sua sponte). The notion that Rooker-Feldman is jurisdictional
"rests on two basic propositions of federal jurisdiction." Brown &
Root, Inc. v. Breckenridge, 211 F.3d 194, 198 (4th Cir. 2000). One
is that "Congress . . . vested the authority to review state court judg-
ments in the United States Supreme Court alone" under 28 U.S.C.
§ 1257(a). Id. at 198-99. The other is that "Congress has empowered
the federal district courts to exercise only original jurisdiction." Id. at
199. The Rooker-Feldman doctrine, therefore, preserves a fundamen-
tal tenet in our system of federalism that, with the exception of habeas
cases, appellate review of state court decisions occurs first within the
state appellate system and then in the United States Supreme Court.
See Plyler, 129 F.3d at 731. A litigant may not circumvent these juris-
dictional mandates by instituting a federal action which, although not
styled as an appeal, "amounts to nothing more than an attempt to seek
review of [the state court’s] decision by a lower federal court." Id. at
733; see Jordahl v. Democratic Party of Va., 122 F.3d 192, 202 (4th
AMERICAN RELIABLE INSURANCE v. STILLWELL 7
Cir. 1997) (explaining that a litigant "may not escape the jurisdic-
tional bar of Rooker-Feldman by merely refashioning its attack on the
state court judgment[ ] as a § 1983 claim"). For purposes of Rooker-
Feldman, "[t]he controlling question . . . is whether a party seeks the
federal district court to review a state court decision and thus pass
upon the merits of that state court decision." Jordahl, 122 F.3d at 202;
see Brown & Root, 211 F.3d at 202 ("[T]he pivotal inquiry is whether
the federal plaintiff seeks to set aside a state court judgment or
whether he is, in fact, presenting an independent claim." (alterations
and internal quotation marks omitted)).
We agree with the district court’s conclusion that Appellants’ fed-
eral action was the "‘functional equivalent’ of an appeal from the June
11, 2001 state court decision." American Reliable, 212 F. Supp. 2d at
627. Appellants sought a federal court order requiring the arbitration
of the Stillwells’ state claims, precisely the same ruling denied to
Appellants in state court. That is, Appellants were asking the federal
courts to reach the "correct" result that they believe was denied in
state court. Rooker-Feldman generally applies when a state-court liti-
gant "sues in federal district court to readjudicate the same issues
decided in the state court proceedings." Brown & Root, 211 F.3d at
201; see id. at 200 (applying Rooker-Feldman doctrine where the fed-
eral complaint sought "precisely the same relief denied by the state
trial court" and the briefs filed presented "an argument which the state
court had already rejected"); Plyler, 129 F.3d at 731 (explaining that
Rooker-Feldman principles bar district court consideration of "issues
actually presented to and decided by a state court"). Appellants’ fed-
eral complaint sought, in substance if not in form, to reverse the state
court’s decision and send the Stillwells’ claims to arbitration.
However, we need not rely only on the fact that Appellants are
seeking adjudication of precisely the same claim rejected by the state
court to apply Rooker-Feldman. Appellants submitted a brief to the
district court making it plain that the purpose of the federal action was
to correct the ruling of the state court:
[T]he state court issued an erroneous ruling which failed to
follow Federal law under the FAA and which denied the
motion to compel arbitration on the ground that the arbitra-
tion clause had not been separately "bargained for." . . . The
8 AMERICAN RELIABLE INSURANCE v. STILLWELL
state court’s decision denying arbitration is directly contrary
to binding United States Supreme Court authority under the
FAA, which firmly holds that a court may not discriminate
against an arbitration clause by enforcing all other provi-
sions of a contract but not its arbitration clause. Allied-Bruce
Terminix Cos. v. Dobson, 513 U.S. 265, 277 (1995).
Accordingly, the [Appellants] hereby move this Court to
enforce Federal law under the FAA and to enter an Order
compelling the parties’ dispute to arbitration.
American Reliable, 212 F. Supp. 2d at 625. The Rooker-Feldman bar
applies to claims such as this one where, "in order to grant the federal
plaintiff the relief sought, the federal court must determine that the
[state] court judgment was erroneously entered or must take action
that would render the judgment ineffectual." Jordahl, 122 F.3d at 202(internal quotation marks omitted).
Thus, we conclude that Appellants’ federal action is the functional
equivalent of an appeal of the state court order denying arbitration
and is impermissible under the Rooker-Feldman doctrine.
B.
Appellants contend that the Rooker-Feldman doctrine cannot apply
here because, although the underlying state action had been pending
for more than one year, Appellants filed the federal action before the
state court rendered its decision on the motion to compel arbitration.
Appellants argue that because the Rooker-Feldman doctrine is consid-
ered jurisdictional, the critical time for determining whether it applies
is at the time that the federal action is commenced. See, e.g., Athena
Auto., Inc. v. DiGregorio, 166 F.3d 288, 290 (4th Cir. 1999) (explain-
ing that federal diversity jurisdiction "attaches at the commencement
of an action" and subsequent events do not destroy the federal court’s
"authority to decide the case"). According to Appellants, therefore, a
subsequent decision by the state court will not cause the federal court
to lose subject matter jurisdiction — even, presumably, if the federal
action raises precisely the same issue as that considered and disposed
of by the state court. Cf. Jamison v. Wiley, 14 F.3d 222, 239 (4th Cir.
1994) ("That the federal court ultimately rejects the federal defense
that supported removal under § 1442(a)(1) does not mean that it
AMERICAN RELIABLE INSURANCE v. STILLWELL 9
thereby loses subject matter jurisdiction over the removed action; the
jurisdiction of the federal courts over a properly removed action will
not be defeated by later developments in the suit." (internal quotation
marks omitted)).
We cannot agree that the sequence in which the federal plaintiff
files the action and the state court issues its judgment is absolutely
controlling for Rooker-Feldman purposes. We have previously
applied Rooker-Feldman despite the fact that the federal complaint
was filed before the state court rendered its decision without expressly
addressing the issue. See Friedman’s, 290 F.3d at 195-97. Other cir-
cuits have done likewise. See, e.g., In re Gen. Motors Corp. Pick-Up
Truck Fuel Tank Prods. Liab. Litig., 134 F.3d 133, 137-40, 143 (3d
Cir. 1998) (applying Rooker-Feldman doctrine where federal action
was commenced prior to state court’s decision without discussing the
filing sequence); Datz v. Kilgore, 51 F.3d 252 (11th Cir. 1995) (per
curiam) (same). With the issue now before the court, we conclude that
the order in which the federal action was filed and the state decision
issued is a relevant, but not controlling, consideration in answering
the key question of "whether a party seeks the federal district court
to review a state court decision and thus pass upon the merits of that
state court decision." Jordahl, 122 F.3d at 202.
To find otherwise would permit litigants to nullify the purpose of
Rooker-Feldman by precisely the kind of ploy used here by Appel-
lants. Appellants filed their federal action to compel arbitration prior
to the state court’s decision on Appellants’ identical motion in state
court. Appellants did not serve the Stillwells with the complaint, how-
ever, intending "to let the federal complaint sit in the Clerk’s office
without serving it while awaiting the state-court decision" and to pur-
sue it only if Appellants lost in state court. J.A. 386. And, in fact,
Appellants served process two days after the state court rendered
them an unfavorable decision, and immediately filed an identical
motion to compel arbitration in federal district court. In support of the
motion to compel arbitration, Appellants argued that the state decision
denying arbitration was erroneous. Clearly, Appellants were making
the functional equivalent of an appeal of the state decision in district
court; they should not be permitted to avoid Rooker-Feldman by pre-
paring a complaint raising claims identical to those in state court, i.e.,
10 AMERICAN RELIABLE INSURANCE v. STILLWELL
the "appeal", and filing it immediately prior to the state court decision
in preparation for an adverse determination.
Although we treat Rooker-Feldman as a jurisdictional doctrine,
there is undeniably substantial overlap between it and various doc-
trines of abstention and preclusion. See Vulcan Chem. Techs., Inc. v.
Barker, 297 F.3d 332, 343 (4th Cir. 2002) (recognizing that "our dual
system of government" is protected by "full faith and credit, the
Rooker-Feldman doctrine, the Erie doctrine, abstention, and other
similar doctrines"); see also United States v. Owens, 54 F.3d 271, 274
(6th Cir. 1995) (observing that Rooker-Feldman is "a combination of
the abstention and res judicata doctrines"); Barry Friedman & James
E. Gaylord, Rooker-Feldman, From the Ground Up, 74 Notre Dame
L. Rev. 1129, 1173-74 (1999) ("Rooker-Feldman . . . operates to plug
any gap in the Younger and preclusion doctrines when a party who
could have chosen to litigate in federal court instead chooses state
court and then in the course of litigation becomes unhappy with that
decision."). As the district court held, the application of abstention
under Colorado River might well have been appropriate if it were not
obvious that Appellants were effectively appealing the decision of the
state court — for example, if Appellants had filed and pursued the
federal petition to compel arbitration before or immediately after
moving in state court for arbitration. Cf. Vulcan, 297 F.3d at 338 n.2
(holding that district court abused its discretion by failing to abstain
from exercising its jurisdiction over an action to vacate an arbitration
award where it "obtained jurisdiction over . . . [the arbitration] claim
before the California court did.").
In sum, we hold that a party cannot avoid Rooker-Feldman merely
by filing a complaint in federal court immediately before the state
court renders its decision where it is patently obvious, as it was here,
that the federal action is intended to be nothing more than an appeal
of an unfavorable decision by the state court. The timing of the filing
of the complaint in federal court is a relevant consideration, but it is
not outcome determinative. This is consistent with the spirit of the
Rooker-Feldman doctrine which, by elevating substance over form,
preserves the independence of state courts as well as congressional
intent that an appeal from a state court decision must proceed through
that state’s system of appellate review rather than inferior federal
courts.
AMERICAN RELIABLE INSURANCE v. STILLWELL 11
C.
Appellants object to the district court’s application of Rooker-
Feldman on one additional ground. Appellants argue that the district
court erroneously applied Rooker-Feldman because the West Virginia
Supreme Court, in refusing to reconsider its denial of Appellants’
petition for appeal, stated that "an appeal of the merits of this matter
continues to be premature" because "it appears that issues of fact and
of state law have not been finally determined below, which issues
may determine the questions of when and to what extent the Federal
Arbitration Act applies." Stillwell v. American Reliable Ins. Co., No.
012231 (W. Va. March 13, 2002). Appellants contend that the lan-
guage used by the West Virginia Supreme Court in this order sug-
gested that the circuit court’s order denying arbitration was
"preliminary" and "subject to change after further development of the
factual record," Appellants’ Answering and Reply Br. at 9, and that
the application of Rooker-Feldman was therefore inappropriate.
Rooker-Feldman, however, "applies to interlocutory orders issued by
state courts . . . [because] [i]t cannot be the meaning of Rooker-
Feldman that, while the inferior federal courts are barred from
reviewing final decisions of state courts, they are free to review inter-
locutory orders." Brown & Root, 211 F.3d at 199 (internal quotation
marks omitted) (second alteration in original). Appellants’ argument
seems to suggest that, for purposes of Rooker-Feldman, there is a dis-
tinction between a preliminary order and one that is merely interlocu-
tory. The distinction is purely semantic. See Black’s Law Dictionary
815 (6th ed. 1990) (defining an "interlocutory order" as "one which
does not finally determine a cause of action but only decides some
intervening matter pertaining to the cause, and which requires further
steps to be taken in order to enable the court to adjudicate the cause
on the merits"). The state court rendered an adjudication on the merits
of the arbitration issue which the West Virginia Supreme Court left
standing. The fact that such an order may be theoretically subject to
modification does not impact the Rooker-Feldman analysis. It is suffi-
cient that a state court render a decision resolving an issue that is the
basis for the federal action, even if the decision comes in the form of
an interlocutory or preliminary order. See Campbell v. Greisberger,
80 F.3d 703, 707 (2nd Cir. 1996) (applying Rooker-Feldman where
state order denied federal plaintiff’s claim but indicated the court
would reconsider the issue if additional evidence was submitted);
12 AMERICAN RELIABLE INSURANCE v. STILLWELL
Port Auth. Police Benevolent Ass’n v. Port Auth. of N.Y. and N.J.
Police Dep’t, 973 F.2d 169, 178 (3d Cir. 1992) (finding Rooker-
Feldman applicable because "the preliminary injunction issued by the
New York trial court . . . resolved, at least for the moment, the dispute
between the parties which forms the basis of the federal complaint at
issue in this case"). Thus, we reject this argument as well.
III.
The Stillwells cross appeal the district court’s denial of their
motion for attorney’s fees and litigation expenses related to their
opposition to Appellants’ federal action seeking to compel arbitration.
In turn, Appellants challenge the district court’s denial of their motion
for sanctions under Rule 11 of the Federal Rules of Civil Procedure,
filed in response to the Stillwells’ motion for attorney’s fees.
Before the district court ruled on the issue of arbitration, the Still-
wells filed a motion for attorney’s fees and costs in the event that the
district court ruled in their favor. The district court denied this motion
because it found no statutory or common law basis permitting an
award of fees. In denying the Stillwells’ Rule 59(e) motion to alter or
amend its order, the court explained that neither federal nor state law
afforded a basis for recovery:
West Virginia law is quite clear: The American rule that
both sides of a civil controversy must pay their own attor-
ney’s fees remains the law in the absence of a statutory or
contractual provision providing for recovery of attorney’s
fees or case law that carves out an exception. Because there
is no statutory or contractual provision or case law that
carves out an exception, the American Rule must apply.
Further, there is no provision in the Federal Arbitration
Act . . . that awards attorney’s fees to a party who is suc-
cessful in pursuing a motion to compel arbitration or in
defeating a motion to compel arbitration. . . . [A]warding
attorney’s fees to a party who defeats a motion to compel
arbitration under the FAA would frustrate Congress’ inten-
tion to "rigorously enforce" arbitration agreements.
AMERICAN RELIABLE INSURANCE v. STILLWELL 13
American Reliable, 212 F. Supp. 2d at 633-34. Generally, we review
a district court’s decision awarding or denying attorney’s fees and
costs for abuse of discretion. See Hitachi Credit Am. Corp. v. Signet
Bank, 166 F.3d 614, 631 (4th Cir. 1999).
We conclude that the district court did not abuse its discretion in
denying the Stillwells’ motion for fees and costs. The Stillwells have
failed to identify any statutory or common law basis that would sup-
port an award of attorney’s fees, and there is no contractual provision
in the policy that would permit fee-shifting. See Alyeska Pipeline
Serv. Co. v. Wilderness Soc’y, 421 U.S. 240, 247, 263-64 (1975)
(explaining that without statutory authorization or contractual agree-
ment between the parties, the prevailing American rule is that each
party in federal litigation pays his own attorney’s fees); Helmick v.
Potomac Edison Co., 406 S.E.2d 700, 709 (W. Va. 1991) (same).
Although the Stillwells now suggest that a lower federal court has the
inherent power to award attorney’s fees as a sanction to control the
conduct of litigants, see Chambers v. NASCO, Inc., 501 U.S. 32, 43-
44 (1991), we decline to consider it because they failed to present this
argument to the district court. Moreover, in filing this action, Appel-
lants have not "acted in bad faith, vexatiously, wantonly, or for
oppressive reasons" such that the court abused its discretion in not
awarding attorney’s fees. Chambers, 501 U.S. at 45-46 (internal quo-
tation marks omitted). Because the district court correctly determined
that the Stillwells did not identify an appropriate basis for recovering
fees and costs, the court did not abuse its discretion in denying their
motion.4
We likewise conclude that the district court was within its discre-
tion in denying Appellants’ motion for sanctions pursuant Rule 11 of
the Federal Rules of Civil Procedure. See Bass v. E.I. DuPont de
Nemours & Co., 324 F.3d 761, 767 (4th Cir. 2003) (applying abuse
of discretion standard of review to the imposition or denial of Rule
11 sanctions). Appellants moved for sanctions on the grounds that the
Stillwells’ motion for attorney’s fees was frivolous and filed only as
an improper litigation tactic. The district court denied the motion "be-
4
As did the district court, we decline as unnecessary the Stillwells’
request that we certify the question of attorney’s fees to the West Vir-
ginia Supreme Court of Appeals. See W. Va. Code § 51-1A-3.
14 AMERICAN RELIABLE INSURANCE v. STILLWELL
cause the [Stillwells’] motion for attorney’s fees was not filed for any
improper purpose such as to harass or cause unnecessary delay or
needless increase in the cost of litigation." American Reliable, 212 F.
Supp. 2d at 631. Moreover, "[a]lthough this Court does not agree with
the defendants’ argument that attorneys’ fees should be granted, this
Court does not find that the defendants’ argument was frivolous." Id.
at 631-32. On the record before us, we cannot say that the district
court abused its discretion. Thus, we affirm the denial of Appellants’
motion for Rule 11 sanctions as well.
IV.
For the foregoing reasons, the judgment of the district court is
hereby affirmed.
AFFIRMED